Investment in Belt and Road economies to reach $25b in 2020

chinadaily.com.cn General 2018-07-12 14:33:00

China's direct investment in countries and regions that are part of the Belt and Road Initiative is estimated to reach $25 billion in 2020, up 100% from the levels seen in 2014, according to a new report from Commerzbank AG, Germany's second-biggest bank by assets.


The Belt and Road Initiative is redefining China's outbound mergers and acquisitions, with some 450 acquisition deals in Western Europe during 2016 and 2017, and 300 in 74 countries and regions that were part of the initiative during the same period, the bank said in its report. The total value of the deals during the period reached $120 billion and $60 billion respectively.


However, the number of M&A deals in Western Europe declined by 18% in 2017 from the 2016 level. Deals in countries and regions participating in the Belt and Road Initiative surged 8% during the same period.


It is estimated that M&A deals between China and Western Europe will increase in the next few years, particularly as the United States becomes more challenging for Chinese companies, and more European companies take advantage of being at one end of the initiative.


"We see China as one of our most important international markets. Many of our clients are interested in what is happening in China and in supporting the initiative," said Roland Boehm, divisional board member at Commerzbank.


He noted that the initiative will bind Europe and Asia much more closely. "It will lead to a genuinely better understanding between China and Germany about each other, and about the potential for cooperation in the future."


"We believe that the Belt and Road Initiative is giving Chinese companies an opportunity to show the outside world that they no longer deserve a reputation as technology and asset hunters, but instead offer high-value products and services," said Boehm.


According to Commerz-bank, China is already the largest supplier of mobile phones in many countries of sub-Saharan Africa, and a serious player globally in terms of higher-end models due to the emergence and expertise of Huawei and Xiaomi.


In January 2017, Chinese group Sirio Pharma's acquisition of Ayanda, a leading European softgel manufacturer, helped create more value for European customers due to the Chinese company's production capacity.


"China's corporate evolution, from being a home for low-cost manufacturing of parts and goods for multinationals such as Apple and Nike to being a producer of high-value products, is shaping mergers and acquisitions in the Belt and Road region," said Boehm.


In terms of the regional M&A targets, Commerzbank highlights an emerging distinction between technology-focused acquisitions in Europe - such as ChemChina's acquisition of Pirelli, and power and infrastructure projects in Central and South East Asia and Africa.


Chinese companies are also seeking opportunities in other Belt and Road countries and regions that have burgeoning populations but underdeveloped infrastructure such as India, Vietnam and Thailand.


"We see numerous M&A deals happening along the B&R, because of the sharing of technology, the sharing of concepts, and the opening of the market. We are optimistic about the future," said Boehm.


(Writing by Jessie Jia  Editing by Harry Huo)
For any questions, please contact us by inqury@fwenergy.com or +86-351-7219322.

Share this article
Connect with us

Editors Recommendations

1 China's top 3 provinces contribute 69% of raw coal output in 2018 2019-01-23

Northern China's three largest coal bases produced 68.89% of the country's total raw coal in 2018, almost unchanged as compared to January-November's 69.1%, showed data from the National Bureau of Sta

2 China Coal Daily Track (Jan 23) 2019-01-23

Thermal coal Domestic market Production area In Shaanxi, coal prices climbed further as local supply remained tight amid production suspension at local mines. One miner has raised p

3 Shaanxi's Yulin urges steady coal supply during holiday and "two sessions" 2019-01-23

Yulin city, one major coal hub in northwestern China's Shaanxi province, urged in a notice that local mining companies should ensure steady coal supply during the upcoming Lunar New Year holiday and t

4 Chinese spot thermal coal market cools down; traders caution post-holiday drops 2019-01-23

Chinese spot thermal coal market showed signs of cooling down, as factories are closing with the approaching Lunar New Year holiday and the mine accident effect is also dying down. On Jan

5 China import thermal coal prices at 2-mth high as sentiment heats up 2019-01-23

Prices of overseas thermal coal to be sold to China have climbed to a two-month high lately, as foreign miners stayed bullish on supply shrink and better demand from India, though Chinese buying inter

6 China Shenhua 2018 commercial coal output up 0.4% YoY 2019-01-23

China Shenhua Energy Co., Ltd, a listed arm of China Energy Investment Corporation, produced 296.6 million tonnes of commercial coal in 2018, up 0.4% year on year, the company said in a statement issu

7 China's daily crude steel output up 3.5% over Jan 1-10, CISA 2019-01-23

Daily crude steel output of member companies of the China Iron and Steel Association (CISA) rose 3.53% from the previous ten days to 1.84 million tonnes on average over January 1-10, according to the

8 China coal mine safety further improves last yr; death rate below 0.1 person 2019-01-23

China's coal mine safety further improved in 2018, with deaths per million tonnes of coal produced stood at 0.093 person, falling below 0.1 person for the first time ever and down 12.3% year on year,

9 China's steel industry to face tougher challenges under environmental pressure 2019-01-23

Chinese steel industry is expected to face greater challenges in the country's harsher push to ultra-low emission reforms in 2019, which is aimed to better address air pollution.

10 China coastal coal shipping market slides for over 10 days 2019-01-23

China's coastal coal shipping market has been on the decline for 11 days, dragged by low shipment demand as utilities dwelt on high stockpiles on the whole. The freight for 50,000-60,000

Most Read Articles

1 More coal mines ordered to stop production in Shaanxi 2019-01-16

More coal mines are ordered to halt operation for rectification in Yulin city, northwestern China's Shaanxi province after a fatal accident in Shenmu on January 12. Coal mines with blasti

2 Will China coal market strengthen after fatal mine accident? 2019-01-15

A severe coal mine accident happened on January 12 has brought Chinese coal industry into spotlight. Strengthened safety inspection will inevitably lead to a reduction of coal output in the short run.

3 China 2018 coal imports up 3.9%, above expectations 2019-01-14

China imported a total 281.23 million tonnes of coal, lignite included, in 2018, customs data showed, failing to meet the government's earlier expectations of controlling at lose to the 2017 level.

4 Thoughts about Chinese Shenmu coal accident 2019-01-18

One deadly coal mine accident in northwestern China's Shaanxi province on January 12, which took away 21 lives, has shocked the entire market. Beyond sorrow and regret, there are many aspects we sh

5 Indonesian coal miners bullish about near-term market 2019-01-17

Indonesian miners were bullish about the thermal coal market in the near future, traders reported, buoyed by Chinese mine accident, rain-induced supply shortage and Indonesian government policy.

6 China's Menghua railway may barely influence near-term coal shipment layout 2019-01-17

China's long-awaited Menghua railway that connects coal production bases with industrial hub in the South is expected to finish construction and open to traffic before October 1 this year at the soone

7 China's coal remaining reserves & resources exceed 1.6 tln T 2019-01-17

China's remaining reserves & resources of coal reached 1.67 trillion tonnes by the end of 2017, according to a report issued by the Ministry of Natural Resources, up 4.3% from a year ago.

8 Shaanxi Shenmu coal mines halted after accident, propping up local prices 2019-01-15

Seventy private coal mines in Shenmu of Shaanxi province in northwestern China have been ordered to halt production, after roof collapse at a mine in the city caused 21 deaths last weekend.

9 Traders divided on China's pre-holiday thermal coal market 2019-01-18

Participants in Chinese spot thermal coal market were divided in the short-term outlook before the Spring Festival holiday, with some holding back on sales anticipating strong pickups while the others

10 China Coal Daily Track (Jan 17) 2019-01-17

Thermal coal Domestic market Production area Thermal coal prices continued rising at major production areas. A large numbers of coal mines in Shenmu and Fugu of Shaanxi halted produc

Scan to download sxcoal.com mobile APP

X